We have been studying the mechanism of dosage compensation in order to understand an important sex-dependent developmental process and in the hope that we would uncover some fundamental aspects of transcriptional regulation. Our work to date indicates that the chromatin-modifying complex responsible for dosage compensation enhances gene transcription by facilitating elongation. The presence of related complexes in yeast and in humans suggests that the Drosophila complex is the prototype of a novel family of chromatin remodeling complexes. A major technical breakthrough during the previous grant period was the development of an experimental model that is intermediate in complexity between nucleosomal arrays reconstituted in vitro with purified DNA and histones, and endogenous native chromosomal chromatin. Our model consists of reproducing dosage compensation, i.e. a precise twofold level in transcriptional enhancement, on a plasmid transfected and transiently expressed in cultured cells. Making use of this model, we propose to pursue and achieve the following specific aims: (1) we will determine the nature and extent of the chromatin modifications mediated by the complex; (2) we will determine the role played by the individual enzymatic components of the complex in these modifications; (3) we will test our hypothesis that the complex enhances gene activity by facilitating transcript elongation. In addition, we will continue our efforts to address the following two specific aims: (4) we will search for modifiers of the complex's activity, and (5) We will identify the sequence features that distinguish the X chromosome from the remainder of the genome. [unreadable] [unreadable]